Category Archives: Strategy

BIMCO is one of the leading standardization forces in the world of shipping. Here is an example related to cybersecurity.

How do you write a contract that binds participants to provide an appropriate level of cybersecurity? As the article makes clear, cybersecurity has been an issue in several recent shipping incidents. Cyber attack is very real, and shipboard systems are great targets; they have low-speed interfaces to the network, there are relatively few kinds of content transmitted, and they operate in international waters where there is no specific enforcement. And cybersecurity can be expensive, though it is low-cost compared to the damage that could result from just one incident.

Standards are needed. BIMCO springs to the task. The drafting team consisted of a law firm, shipowners, P&I clubs, and Klaveness, a maritime investment firm. There’s a two-fold notification process; immediate notification of an incident, and then a detailed notification once an incident has been investigated.

The parties are required to share the information throughout. This last point is important, because cyber events often require joint resolutions for mitigation and future prevention.

The contract element also requires any third parties employed by the participants to have adequate cybersecurity, and makes the primary firms responsible for seeing to it.

Now we will have to see whether the clause catches on in the contracts we see written. There is always a risk with a top-down driven standard; it may miss the issues the market needs to address.

Research has shown (albeit in other contexts, such as health care) that top-down standard initiation often does not produce the penetration of results that flexible evolution of a standard does. However, someone has to start the ball rolling, and here we have a credible effort.

Let’s now see more innovation in this area of contracting, and let’s see the results in the open, so the best combination of terms emerges and gets global acceptance.

SAE is the former Society of Automotive Engineers, and has been a leader in standard setting for many years. There is clearly a need for standards around data for shared bike and scooter services, for instance. The main cooperators are Miami-Dade County, Jump, Spin, and Populus (a data platform).

A similar effort by Los Angeles called the Mobility Data Specification (MDS) led to major complaints from Uber and Lyft, the ride-hailing service operators. They don’t want to be bound by the rules. Other cities have been following the MDS as well.

Perhaps such a consortium effort could help resolve these problems. I’m surprised there isn’t communication between the Los Angeles group and the SAE.

This article from the Loadstar indicates that supply chain firms such as Flexport are struggling to align themselves for the volatile tariff situation we have now. Some firms are leaving China but others are staying in and look for an alternate shipment method with more speed and smaller inventory.

SF Airlines (Wikipedia) is a Chinese cargo airline with headquarters in Shenzen, Guangdong Province. They have about 55 aircraft. SF submitted an application to the USDOT last week for a 3x per week service on the Hangzhou-New York route. We will see if approval is granted.

Flexport indicated they are seeing a dropoff in trade with China. But 3PLs like Flexport work to help companies transport goods from anywhere. Rearrangement of transport becomes the norm, and their business depends on success for their customers.